NBA Grizzlies, 10 years later: Still in hibernation

Mike Beamish, Vancouver Sun02.18.2011

Precisely one decade ago, this sign at GM Place summed up many West Coast basketball fans’ attitude towards Vancouver Grizzlies owner Michael Heisley, NBA commissioner David Stern and the mess that their franchise had become. Mere months after this February 2001 sign went up, the team had decamped for Memphis, where it’s gone on to serve out another 10 years of utter mediocrity.

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VANCOUVER — Vancouver is unabashedly a hockey town, but those who yearn for a return of the National Basketball Association got something of a glimmer of hope this week from commissioner David Stern.

Interviewed on an ESPN radio podcast, the same man who allowed the Vancouver Grizzlies to skip off to Memphis in 2001 and the Seattle SuperSonics to decamp in Oklahoma City seven years later expressed his regrets that it all came about.

In the strange up and downs of sports politics, Stern restored the step to those who lament that the Grizzlies and Sonics ever left.

“I have regrets about Vancouver and Seattle,” Stern admitted. “I think maybe or maybe not on my watch, when Seattle has plans for a new building, that’s a very prime city for an NBA franchise.

“We’ve had [exploratory] visits from, believe it or not, Vancouver, where the Canucks are absolutely doing a spectacular job there.”

It should be recalled that, 10 years ago this month, the Save the Grizzlies society, a group of business people hoping to keep the NBA alive in Vancouver, sought an audience with the commissioner in hopes of stopping owner Michael Heisley from moving the team to Memphis.

“We were scrambling at the 11th hour,” admits Peter Ufford, one of the spearheads of Save the Grizzlies. “There was an excellent plan put together to create a public entity, RRSP eligible, that might have kept the team here. Given more time, who knows what we could have done had the momentum been maintained?”

But Heisley, a Chicago industrialist who brought the Grizzlies in 2000 from John McCaw, the Seattle-born owner of Orca Bay Sports and Entertainment, was intent to make the move happen, no matter what, citing projected losses of $40 million in his single year of operation.

On Friday, Heisley, speaking from Los Angeles where he’s attending the NBA all-star weekend, said the losses were closer to $87 million. That likely includes a $30-million relocation fee levied by the NBA, to Heisley’s surprise, when he moved the team to Memphis.

“Not a lot of that stuff came out in the hoopla [to save the Grizzlies in Vancouver],” he said. “I offered to sell the team there at a 30-per-cent discount to local interests. There were no takers. I did what the economy really forced me to do. It never crossed my mind that such a disparity between the currencies [the Canadian dollar was worth 67 cents US] existed. Seventy per cent of our revenue was going to pay salaries — players, coaches and people.”

Financial struggles

The olive branch that Stern tossed to Seattle and Vancouver earlier this week is in contrast to what he said three years ago, when the commissioner criticized the City of Seattle and the Washington legislature for their handling of funding for a replacement arena. He warned that if the Sonics left Seattle he saw no way the NBA would ever return to the city. They left for Oklahoma City in 2008, to become the Thunder, after a 41-year run by the shores of Puget Sound.

Now, the league’s most notable voice is making nice with municipalities that were once spurned. Perhaps it has something to do with this: An estimated one-third of the NBA’s 30 teams will end up in the red this season, the orphaned New Orleans Hornets are wards of the league, and other tottering franchises could be available for the right price.

One of the losers belongs to Heisley, who fashioned a Forbes 500 business career as a flipper — buying up distressed companies, rehabilitating them and turning them into profit-making ventures. His success in the NBA, however, has been a public and personal failure. A decade after claiming Vancouver was a sinkhole for basketball, the balance sheet continues to bleed in Memphis, although not at the same rate.

“The biggest thing is that we were collecting Canadian dollars and paying out in U.S. dollars,” he reiterated. “There was an [executive] at The Vancouver Sun ... who wouldn’t believe the losses we were taking. He had an interested party [of prospective buyers] bring their accountants in and take a look at the books. They didn’t make a move whatsoever.”

When Heisley bought the Grizzlies for $160 million US, after the league had rejected Walmart heir-in-law Bill Laurie, who intended to move them to St. Louis, the NBA insisted any new owner give it at least five years. But Heisley said there were no guarantees, although Vancouverites didn’t reckon on the expiration date being as short as it was.

“The reality is [Heisley] had every intention of bankrupting the fan base, alienating people, not marketing the team, presenting the argument that basketball didn’t work in Vancouver, which was hogwash,” says Arthur Griffiths. “We were not, by any stretch of imagination, losing millions and millions. We had a better fan base than most NBA teams.”

Griffiths’ comments make Heisley bristle. “If he’s saying that, he’s either stupid or basically, he’s lying,” he says. “I’d be very happy to pay him 10 times what I lost if he can prove it.”

Griffiths, living in London and involved in businesses that revolve around the 2012 Summer Olympics, is unrepentant about his courtship of the NBA, even though it came close to ruining him and marked the beginning of the end of his family’s involvement in sports ownership. As the cost to construct the Canucks/Grizzlies playpen, GM Place, ballooned to $163 million from $100 million, he was forced into a precarious financial juggling act. At $125 million US, the NBA franchise fee in 1995 was set exorbitantly high to test an owner’s resolve.

Griffiths’ commitment to basketball was deep, but his pockets not so much. He was forced to take on McCaw — who was set for life when his family sold its cellular business to AT &T for $11 billion — as a partner. McCaw eventually ended up with total control of Orca Bay, and Griffiths spent his last days with the organization as a high-profile employee.

“More people ask me about the NBA than anything else in my whole life,” Griffiths says. “‘Are they coming back? What do you think of the possibilities of another NBA team?’ Vancouver was given a horribly bad expansion agreement. They were trying to make sure we were not successful quickly. It was so moronic. You spend $125 million and you hope they’d treat you as an equal partner. I think the NBA has to take some responsibility for turning its back on the city. And Heisley misled fans deliberately about moving the team.”

Hamstrung by the league

Star-crossed from inception, the Grizzlies lost 300 games faster than any team in NBA history. They started 2-0, but went 99-359 in their next 458 games, and it seemed like everybody who passed through the organization wanted to be somewhere else.

Stu Jackson, a rookie general manager, was hamstrung by the limitations of the expansion agreement, which kept the Grizz from becoming mediocre too quickly. In 1997, despite finishing with the worst record in the league (14-68), Vancouver drafted fourth, missing a shot at franchise centre Tim Duncan, who went to San Antonio. Jackson picked Antonio Daniels, who never rose above journeyman status in 12 NBA seasons.

When Steve Francis sulked his way through the 1999 draft after being selected No. 2 overall by the Grizzlies, he forced Jackson to trade him two months later to Houston, where he became the league’s rookie of the year. It was just one of the dubious moves that soured the Grizzlies’ operation and never allowed them to fly here.

In Memphis, the Grizzlies have achieved a 50-win season and three entrées into the playoffs, but have zero titles, zero post-season wins and six more losing seasons for a franchise record of 435 wins, 802 losses.

Two years ago, Sports Illustrated ranked Heisley as the third-worst owner in the NBA. “He has refused to allow the Grizzlies to go anywhere near the luxury-tax threshold,” SI said.

Case in point: Pau Gasol. The franchise leader in 12 statistical categories was traded to the Lakers in one of the most one-sided deals in NBA history. It was seen, simply, as a salary dump. Gasol made the Lakers instant contenders in the West, and the Grizzlies got a package of players and draft picks to begin yet another rebuilding job.

“The Grizzlies haven’t been the disaster that some people feared, but they have not been the triumph that Michael Heisley had hoped for,” says Geoff Calkins, sports columnist for the Memphis Commercial Appeal. “The franchise is sort of muddling along. It never really has become part of the community. There were people who thought they’d be leaving in five years. Here, 10 years on, they’re still here. They’re not leaving tomorrow. In a way, that’s a success. But it’s a highly qualified success. They clearly struggle. I think the best thing to happen would be an ownership change or for the Grizzlies to go on the kind of post-season run that would reignite interest.”

The 73-year-old billionaire admits he’s been looking for an NBA exit strategy for years, but he can’t find a buyer at his asking price of more than $300 million. He tried to sell the team in 2006, to a consortium that included former NBA player Christian Laettner, but the group came up short on the cash end.

“For the proper price, I’d prefer to sell the team to Memphis interests,” he says. “Whoever buys the Grizzlies, I hope he does a better job than me. When I bought the team, I was like a lot of businessmen — enamoured with sports. If I’d analyzed the situation in Vancouver the way I analyzed all the other businesses I’ve had, I never would have bought them.”

With cumulative losses in Memphis approaching $100 million, Heisley could very well end up selling at a loss. The Grizzlies are third from the bottom in the NBA in value ($266 million), ahead of only Minnesota ($264 million) and Milwaukee ($258 million), according to Forbes Magazine.

Changes in Vancouver

Clearly, the business climate in Vancouver has changed over the past decade, with the Canadian dollar surging, the economy relatively buoyant compared with the U.S, and the arrival of wealth-creators and an entrepreneurial class in a truly global city.

There are NBA fans in Vancouver who still wear Mike Bibby jerseys, are still convinced the Grizzlies would be here if they’d drafted Vancouver Island product Steve Nash, and wait, like the citizens of imaginary Brigadoon, for the league to appear through the mist on Canada’s West Coast again.

But does Vancouver’s new economic muscle make it strong enough to take on another major sports team?

Noah Croom, the Grizzlies’ former assistant GM, now a player agent based in Vancouver, doesn’t think so.

“The market’s probably too small,” he says. “Other than being a nice place to visit, I don’t know if it adds much to the pot. Anaheim or Seattle. Kansas City has a new building. Las Vegas has been mentioned often. All of them would affect generating more league-wide revenues than a team in Vancouver.”

“I’m not saying basketball wouldn’t go there now,” Heisley adds. “But when the Grizzlies left, they became the saviour of the Canucks. Grizzlies fans became Canucks fans. The hockey operation took off. Now you have a team that’s at the top of the league. Is there enough fan and corporate support for two teams in the same building? I gotta believe you’ll weaken the revenue of the Canucks. Do you want to weaken a hockey team that’s had a pretty good ride and is playing for the championship? That’s just my opinion. And I’ve been wrong about the situation there before.”

Still, last October Rogers Arena was sold out for a rare NBA pre-season game between the Toronto Raptors and Phoenix Suns, and the belief that Vancouver could grab a second chance at pro basketball on the rebound turned bullish. “I think it’d be a great opportunity to correct a misstep,” said native son Nash, the Suns’ star point guard.

While Vancouver has grown in size and economic clout since the Grizzlies left, so the sports landscape here has been altered dramatically. The PGA Tour event faltered after the title sponsor pulled out. Expansion of the Expo Lands for condo construction turned into an impenetrable roadblock for the continuation of the Molson Indy. The minor league baseball team fled to Sacramento after Nat Bailey Stadium was deemed unsuitable for the AAA level.

But the losses have been offset by gains. A decade ago, the WHL’s Vancouver Giants didn’t exist, the Vancouver Whitecaps’ entry into Major League Soccer was still a speck on the horizon, the B.C. Lions had yet to experience a resurrection in fan interest and corporate sponsorships, the Canucks were in the early stages of becoming a juggernaut, and the golden glow of the 2010 Olympics had yet to ignite an outpouring of pride and patriotism.

Vancouver has been re-branded. And the jingoistic attitude has people believing anything is possible, including the return of the NBA.

It’s no secret that Francesco Aquilini, who owns the Canucks and Rogers Arena, has been kicking at the NBA’s tires, although it’s a quiet, cautious exercise that may lead to something, or nothing. Aquilini is mindful of stretching the cords of affection for the primary tenant and whether another team, panning the same stream for discretionary income and corporate sponsorship, is really a good thing.

“I think the challenge is that the affinity for basketball isn’t as widespread as hockey,” says Victor DeBonis, COO for Canucks Sports and Entertainment group. “First and foremost, our priority is with the hockey team. That is our primary business. We have a very, very solid foundation there, and we never want to lose focus of that.”

Maple Leaf Sports and Entertainment operates two teams out of the Air Canada Centre in Toronto — the NHL Maple Leafs and the NBA Raptors — in addition to the Toronto FC in MLS, the American Hockey League Toronto Marlies and pay-per-view sports channels. But east is east and west is west, and there are major differences between the Canadian cousins who entered the NBA together in 1995.

“Toronto is a huge market,” Heisley says. “That’s not true of Vancouver. I know fans were upset when the Grizzlies left, but there’s a wealth of activities and diversions — skiing, hunting, fishing, golf — that few major cities in the world have. That’s great. But it’s something to think about if you want to own a sports team there. All I can say to the people who want the NBA back in Vancouver is: Watch what your wish for.”

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NBA Grizzlies, 10 years later: Still in hibernation

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